Higher ed leaders give tax plan an ‘F’

Education | University presidents urge lawmakers to reconsider imposing new taxes on endowments, graduate students

While the Senate continues to grapple with its version of tax reform legislation, leaders in higher education, including those at Christian colleges, have started lobbying already for changes to the final version.

The Tax Cuts and Jobs Act, passed by the House on Nov. 16, includes several provisions that target higher education, from eliminating the student loan interest tax credit to imposing a new tax on large endowments. In a letter to House leaders, Shirley V. Hoogstra, president of the Council for Christian Colleges and Universities, warned the tax reform package “undermines the foundation of our knowledge-based economy in the long term in exchange for short-term savings.”

“We urge Congress not to pass legislation that makes higher education more expensive, less accessible, and lower quality,” she wrote. “To pass such legislation would be short-sighted and needlessly undermine the educations and financial well-being of countless students, recent graduates, and employees at institutions of higher education.”

Colleges successfully lobbied House lawmakers to modify one provision in the bill, the tax on large endowments. Before voting on the legislation earlier this month, lawmakers raised the financial threshold for triggering the 1.4 percent tax, but as many as 70 schools may still have to pay up. These schools hope to persuade lawmakers to drop the provision altogether when they sit down later this month to reconcile the House and Senate versions of the bill.

Graduate students also hope to eliminate the proposed tax on tuition waivers, which many say they could not pay. Free tuition, often given as a benefit to graduate students who also teach courses, isn’t taxed now. But under the House bill, the Internal Revenue Service would count it as taxable income. That could double or triple the tax bill for some students.

“I wish we didn’t have to stress about money as much as we already do,” Massachusetts Institute of Technology (MIT) graduate student Ryan Hill told NPR. “It’s been already very hard to just emotionally get through this time of life because we have to be so frugal.”

Like other MIT graduate students, Hill gets a $30,000 stipend from MIT but doesn’t pay a penny of his $50,000 tuition bill. If the tuition waiver tax survives the reconciliation process, Hill would have to pay taxes on $80,000.

University leaders have described the tax changes as an assault on higher education, part of a growing trend of criticism over rising tuition costs and degrees that don’t lead to good jobs after graduation. But complaining that the tax code rewrite will make college less attainable for those seeking a post-secondary degree probably won’t sway those who already feel like college is out of reach, one conservative policy analyst noted.

“Very few [Americans] are privileged enough to get a graduate degree from an elite institution,” Jason Delisle of the American Enterprise Institute told Politico. “I think they're like, ‘Complain all you want.’ It’s just not going to resonate with Main Street America.”

If the Senate passes its version of the tax bill by Friday, as planned, lawmakers will spend the next few weeks merging the House and Senate legislation into something both chambers can agree on before the end of the year. The provisions affecting higher education are just a few of the issues lawmakers must iron out. If they can reach an agreement—and that’s a big if—it seems likely some of the taxes targeting higher education will remain in place.

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Fake news meets real bias

Two Stanford University researchers conducting a study on “fake news” ended up with disappointing results when they pitted the liberal American Academy of Pediatrics (AAP) against the conservative American College of Pediatricians (ACPeds).

The researchers asked Stanford students, faculty from the university’s history department, and a group of fact-checkers working for media companies to evaluate the anti-bullying statements on each organization’s website. An overwhelming majority of students, 80 percent, determined ACPed’s statement more trustworthy or equally trustworthy when compared to the the AAP’s statement. Half of the history professors agreed.

The fact-checkers came to a different conclusion after researching both groups and discovering ACPed’s pro-family, pro-life stance. According to the Stanford researchers, the fact-checkers reached the “right” conclusion, even though they didn’t objectively evaluate the anti-bullying statement or its related scientific references. On average, the fact-checkers took just 2 minutes to reach a conclusion, while the other two groups spent nearly three times as long. The researchers, in their concluding paper, said the students and historians reached “unwarranted” conclusions based on evaluating ACPed’s statement at face value.

In a response to the findings, ACPeds noted the irony that a study on “fake news” succumbed to the same blind bias that influences people to believe what they read on the internet, regardless of the facts.

“While it is reasonable to point out to readers that the college is much smaller, younger, and less lucrative than the academy, the investigators were more emotional in their further descriptions, calling the college ‘a splinter group,’ ‘virulently anti-gay,’ and ‘incendiary,’” wrote Den A. Trumbull, a founding member of ACPeds. “It would appear that the investigators were frustrated with the objectivity of the students and historians, since this approach led them to a very different conclusion than they preferred.” —L.J.

Flickr/Photo by COD Newsroom
A student and instructor in a dual-language program at Leman Junior High School in West Chicago, Ill.

Dual-language programs a win for all

A new study of dual-language programs in Portland, Ore., found the immersion curriculum helps students become more proficient in English, as well as the foreign language they are studying. Even non-native English speakers did better on English proficiency tests than students not enrolled in dual-language programs. By fifth grade, dual-language students tested seven months ahead of their peers. By the end of eighth grade, the proficiency gap had widened to the equivalent of nine months learning. Tests showed no difference between the students in math and science, suggesting English speakers in foreign language immersion programs don’t suffer long-term setbacks from trying to learn important concepts in a language they can’t yet speak fluently. —L.J.

Anything you can do …

Last week, the University of Central Florida suspended a sorority over accusations of hazing, underage drinking, and providing false information to law enforcement. The letter from school administrators to Alpha Xi Delta indicates felony charges could soon follow. The incidents took place at an off-campus bar earlier this semester. Sororities at other schools have faced suspensions as part of a system-wide crackdown on Greek organizations, but fraternities are usually the ones caught misbehaving. I guess degrading and humiliating your peers is an equal-opportunity sport. —L.J.

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Leigh Jones

Leigh lives in Houston with her husband and daughter. She is the news editor for The World and Everything in It and reports on education for WORLD Digital.

Comments

Cyborg3

Janet B

Posted: Thu, 11/30/2017 11:43 am

Income tax is not really a tax on "income" but a tax on a person's labor. A graduate student or a landscaper contracts to perform labor in exchange for education or money, respectively. In the case of the landscaper, the government already steps in and takes, for no reason other than they are big and strong, the money the landscaper is due for his labor. It is the same idea for the graduate student.

All contracts are barter, and all income tax on wages (as opposed to income from interest and investments - money making money) is theft.

MTJanet

Posted: Thu, 11/30/2017 01:24 pm

After putting four kids through college, I am giving higher ed an F- on performance, so the government is still coming out ahead. I am hoping most of them crash in the coming years and kids start figuring out a different route to careers altogether.

Peter Allen

Posted: Fri, 12/01/2017 11:27 pm

Many past endowment givers are rolling over in their graves as their money now funds liberal programs and proffersors they would not approve of. Better to give to a cause for immediate use and know how it will be used. Let it be taxed, or to subsidize student tuition which is entirely too high. The rest of us should not have to subsidize tuition through student loan programs, and tax breaks. Wish I would have sent mine to 2 years of comminity college first!